Exhibit 20.5 Use the Information Below for the Following Problem(S)

question 1

Multiple Choice

Exhibit 20.5
Use the Information Below for the Following Problem(S)
Sarah Kling bought a 6-month Peppy Cola put option with an exercise price of $55 for a premium of $8.25 when Peppy was selling for $48.00 per share.
-Refer to Exhibit 20.5.What is Sarah's annualized gain/loss?

• A) 11.51% gain
• B) 115.15% gain
• C) 11.51% loss
• D) 115.15% loss
• E) None of the above

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Definitions:

Stress Episode

A single or series of stressful events that disrupt an individual's emotional equilibrium and may lead to a physical or psychological response.

Reactions

are the responses or behaviors displayed by individuals in response to external stimulus, events, or changes, often showcasing emotions or thought processes.

American Psychological Association

A professional organization representing psychologists in the United States, dedicated to advancing psychology as a science and profession.

Potent Source

An influential and powerful origin or foundation for information, motivation, or authority.